Exhibit 10.37
NETWORK EVENT THEATER, INC.
1999 SPECIAL INCENTIVE STOCK PLAN
1. PURPOSES. The purposes of this Incentive Stock Plan are to attract
and retain the best qualified personnel for positions of substantial
responsibility, to provide additional incentive to the Employees of the Company
or its Subsidiaries, if any (as defined in Section 2 below), as well as other
individuals who perform services for the Company or its Subsidiaries, and to
promote the success of the Company's business.
The Incentives offered pursuant to this Plan are a matter of separate
inducement and are not in lieu of any salary or other compensation for the
services of any Employee or any other individual.
Options granted hereunder may be either "incentive stock options," as
defined in Section 422A of the Internal Revenue Code of 1986, as amended, or
"non-qualified stock options," at the discretion of the Board and as reflected
in the terms of the written instrument evidencing an Option, although the
Company makes no warranty as to the qualification of any Option as an Incentive
Stock Option.
2. DEFINITIONS. As used herein, the following definitions shall apply:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Cause" shall mean (i) an act or acts or personal
dishonesty of a Participant at the expense of the Company or any of its
Subsidiaries, (ii) a willful act of misconduct which is materially injurious to
the Company, monetarily or otherwise, including but not limited to engaging in
any conduct which constitutes a felony under federal, state or local laws (other
than traffic violations); (iii) violation of the management responsibilities by
the Participant which is demonstrably willful and deliberate on the
Participant's part and which is not remedied within a reasonable period of time
after receipt of written notice from the Company or a Subsidiary, or (iv) the
conviction of the Participant of a felony involving moral turpitude.
(c) "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(d) "Common Stock" shall mean the Common Shares of the Company
(par value $.01 per share).
(e) "Company" shall mean Network Event Theater, Inc., a
Delaware corporation.
(f) "Committee" shall mean the Committee appointed by the
Board of Directors in accordance with Section 4(a) of the Plan, if one has been
appointed, or the Board if no Committee has been appointed.
(g) "Continuous Status as an Employee" shall mean the absence
of any interruption or termination of service as an Employee. Continuous Status
as an Employee shall not
be considered interrupted in the case of sick leave, military leave, or any
other leave of absence approved by the Board.
(h) "Employee" shall mean any person, including officers and
directors, employed by the Company or any Parent or Subsidiary of the Company.
The payment of a director's fee by the Company shall not be sufficient to
constitute "employment" by the Company.
(i) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
(j) "Incentive Stock Option" shall mean a stock option
intended to qualify as an incentive stock option within the meaning of Section
422A of the Internal Revenue Code of 1986, as amended.
(k) "Incentives" shall mean any incentive under this Plan,
including Options and Restricted Stock Awards.
(l) "Non-qualified Stock Option" shall mean a stock option not
intended to qualify as an Incentive Stock Option.
(m) "Option" shall mean a stock option granted pursuant to the
Plan (whether an Incentive Stock Option or Non-qualified Stock Option).
(n) "Optioned Stock" shall mean the Common Stock subject to an
Option.
(o) "Optionee" shall mean an Employee or other person who
receives an Option.
(p) "Parent" shall mean a "parent corporation," whether now or
hereafter existing, as defined in Section 425(e) of the Internal Revenue Code of
1986, as amended.
(q) "Participant" shall mean an individual designated by the
Committee to receive the grant of an Incentive.
(r) "Plan" shall mean this 1999 Incentive Stock Plan of the
Company.
(s) "Plan Year" shall mean each calendar year that is the
anniversary of the Effective Date of this Plan, with the first such Plan Year
commencing on the Effective date of this Plan.
(t) "Restricted Stock Award" shall mean the Incentive defined
in Section 10 of this Plan.
(u) "Securities Act" shall mean the Securities Act of 1933, as
amended.
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(v) "SEC" shall mean the Securities and Exchange Commission.
(w) "Share" shall mean a share of the Common Stock, as
adjusted in accordance with Section 12 of the Plan.
(x) "Subsidiary" shall mean a "subsidiary corporation",
whether now or hereafter existing, as defined in Section 425(f) of the Internal
Revenue Code of 1986, as amended.
3. STOCK.
(a) Maximum Number of Shares. Subject to the provisions of Section 12
of the Plan, the maximum aggregate number of shares which may be issued pursuant
to Options granted hereunder shall be _________ Shares, and the maximum number
of shares which may be issued in the form of Restricted Stock Awards granted
hereunder shall be ________. If an Incentive should expire or become
unexercisable for any reason without having been exercised in full, the unissued
Shares which were subject thereto shall, unless the Plan shall have been
terminated, become available for further grant under the Plan. Similarly, Shares
which have been issued, but which the Company retains or which the Participant
tenders to the Company in satisfaction of income and payroll tax withholding
obligations or in satisfaction of the exercise price of any Option shall remain
authorized and shall again be available for the purposes of the Plan, provided,
however, that any such previously issued Shares shall not be the subject of any
grant under this Plan to any officer of the Company who, at the time of such
grant, is subject to the short-swing trading provisions of Section 16 of the
Exchange Act.
(b) Plan Year Limitations. The maximum number of Shares with respect to
which Options may be granted in any Plan Year to any Optionee will be
__________. The maximum number of Shares with respect to which Restricted Stock
Awards may be granted in any Plan Year to any Participant will be ____________.
(c) Source of Shares. Shares which may be acquired under the Plan may
be either authorized but unissued Shares, Shares of issued stock held in the
Company's treasury, or both, at the discretion of the Company.
(d) No Rights as Stockholder. A Participant under this Plan shall have
no rights as a stockholder with respect to any Shares subject to such Incentive
until such Shares have been issued.
4. ADMINISTRATION.
(a) Procedure. The Company's Board of Directors may appoint a Committee
to administer the Plan. The Committee shall consist of not less than two (2)
members of the Board of Directors who shall administer the Plan on behalf of the
Board of Directors, subject to such terms and conditions as the Board of
Directors may prescribe. The Committee shall be comprised of at least two
disinterested persons (the term "disinterested" having the meaning ascribed to
it by Rule 16b-3 of the Exchange Act). Any member of the Committee must recuse
him or herself from any vote or discussion of Incentives that have been or may
be granted to such member under the Plan.
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A majority of the Committee shall constitute a quorum, and the act of a majority
of the members of the Committee shall be the act of the Committee. Once
appointed, the Committee shall continue to serve until otherwise directed by the
Board of Directors. From time to time the Board of Directors may increase the
size of the Committee and appoint additional members thereof, remove members
(with or without Cause), and appoint new members in substitution therefor, fill
vacancies, however caused, or remove all members of the Committee and thereafter
directly administer the Plan. If the Board of Directors fails to appoint a
Committee then the Board of Directors shall assume the responsibilities of the
Committee.
(b) Powers of the Committee. Subject to the provisions of the Plan, the
Committee shall have the authority, in its discretion: (i) to grant Incentive
Stock Options, in accordance with Section 422A of the Code, or to grant
Non-qualified Stock Options; (ii) to grant Restricted Stock Awards; (iii) to
determine, upon review of relevant information and in accordance with Section
8(b) of the Plan, the fair market value of the Common Stock; (iv) to determine
the exercise price per share of Options to be granted which exercise price shall
be determined in accordance with Section 8(a) of the Plan; (v) to determine the
vesting period for any Options granted hereunder in accordance with Section 9(a)
of the Plan; (vi) to determine the Restriction Period for any Restricted Stock
Award; (vii) to determine the persons to whom, and the time or times at which,
Incentives shall be granted and the number of shares to be represented by each
Incentive; (viii) to interpret the Plan; (ix) to prescribe, amend and rescind
rules and regulations relating to the Plan; (x) to determine the terms and
provisions of each Incentive granted (which need not be identical) and, with the
consent of the holder thereof, modify or amend each Incentive; (xi) to
accelerate or defer (with the consent of the Participant) the exercise date of
any Participant; (xii) to authorize any person to execute on behalf of the
Company any instrument required to effectuate the grant of an Incentive
previously granted by the Board; and (xiii) to make all other determinations
deemed necessary or advisable for the administration of the Plan. Any
determination of the Committee under the Plan may be made without notice of
meeting of the Committee by a writing signed by a majority of the Committee
members.
(c) Employment of Agents. The Committee may employ such legal counsel,
consultants and agents as it may deem desirable for the administration of the
Plan and may rely upon any opinion received from any such counsel or consultant
and any computation received from any such consultant or agent. The Board of
Directors shall determine the budget for the Committee. Expenses incurred by the
Committee in the engagement of such counsel, consultant or agent shall be paid
by the Company to the extent they do not exceed the budget established by the
Board of Directors. No member or former member of the Committee or the Board of
Directors shall be liable for any action or determination made in good faith
with respect to the Plan or any Incentive.
(d) Effect of the Committee's Decision. All decisions, determinations,
and interpretations of the Committee shall be final and binding on all
Participants and any other holders of any Incentives granted under the Plan,
although the full Board of Directors may, in its discretion, overrule the
decisions of the Committee.
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5. ELIGIBILITY; NON-DISCRETIONARY GRANTS.
(a) General. Incentive Stock Options may be granted only to Employees.
Non-qualified Stock Options and Restricted Stock Awards may be granted to
Employees as well as non-Employee directors and consultants, as determined by
the Committee. A director of the Company or of a Subsidiary who is not also an
officer or Employee of the Company or of such Subsidiary will not be eligible to
receive an Incentive Stock Option or Restricted Stock Award. Any person who has
been granted an Incentive may, if s/he is otherwise eligible, be granted an
additional Incentive or Incentives. The Plan shall not offer upon any
Participant any right with respect to continuation of employment by the Company,
nor shall it interfere in any way with his/her right or the Company's right to
terminate his/her employment at any time.
The Committee shall consider such factors as it deems pertinent in
selecting Participants and in determining the type and amount of their
respective Incentives, including without limitation (a) the financial condition
of the Company, (b) anticipated financial results for the current or future
years, including return on invested capital, (c) the contribution by the
Participant to the profitability and development of the Company through the
achievement of strategic objectives, and (d) other compensation provided to
Participants.
(b) Limitation on Incentive Stock Options. No Incentive Stock Option
may be granted to an Employee if, as the result of such grant, the aggregate
fair market value (determined at the time each Option was granted) of the Shares
with respect to which such Incentive Stock Options are exercisable for the first
time by such Employee during any calendar year (under all such plans of the
Company and any Parent and Subsidiary) shall exceed One Hundred Thousand Dollars
($100,000). Any Options granted in excess of that amount shall be deemed
Non-qualified Stock Options.
6. TERM OF THE PLAN. The Plan shall become effective on the date (the
"Effective Date") of its adoption by the Board of Directors. The Plan shall
continue in effect until the tenth anniversary of its Effective Date unless
sooner terminated under Section 14 of the Plan.
7. TERM OF THE OPTION. The term of each Option shall be ten (10) years
from the date of grant thereof or such shorter term as may be provided in the
instrument evidencing the Option.
8. EXERCISE PRICE AND CONSIDERATION.
(a) General. The per Share exercise price for the Shares to be issued
pursuant to the exercise of an Incentive Stock Option shall be such price as is
determined by the Board, but shall be no less than one hundred percent (100%) of
the fair market value per Share on the date of grant; provided, however, in the
case of an Incentive Stock Option granted to an Employee who, immediately before
the grant of such Incentive Stock Option, owns stock representing more than ten
percent (10%) of the voting power of all classes of stock of the Company or any
Parent or Subsidiary, the per Share exercise price shall be no less than 110% of
the fair market value per Share on the date of grant, as the case may be, and
the term of such Incentive Stock Option may not exceed five (5) years. The per
Share exercise price for the Shares to be issued pursuant to the exercise of
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Non-qualified Stock Option shall be such price as is determined by the Board,
but shall be no less than eighty-five percent (85%) of the fair market value per
Share on the date of grant.
(b) Fair Market Value. The fair market value shall be determined by the
Committee in its discretion, which determination shall be conclusive; provided,
however, that where there is a public market for the Common Stock, the fair
market value per Share shall be the mean of the bid and asked prices or, if
applicable, the closing price of the Common Stock on the date of grant, as
reported by the National Association of Securities Dealers Automated Quotation
(NASDAQ) System (although if there are no bid or asked prices on such date, or
no closing price, the prices on the closest date preceding the date of grant
shall be used); in the event the Common Stock is listed on a stock exchange, the
fair market value per Share shall be the closing price on such exchange on the
date of grant of the Option, as reported in the Wall Street Journal.
(c) Consideration. The consideration to be paid for the Shares to be
issued upon exercise of an Option or in payment of any withholding taxes on any
Incentive, including the method of payment, shall be determined by the Committee
and may consist entirely of (i) cash, check or promissory note; (ii) other
Shares of Common Stock owned by the Employee having a fair market value on the
date of surrender equal to the aggregate exercise price of the Shares as to
which said Option shall be exercised; (iii) an assignment by the Employee of the
net proceeds to be received from a registered broker upon the sale of the Shares
or the proceeds of a loan from such broker in such amount; (iv) any combination
of such methods of payment; or (v) such other consideration and method of
payment for the issuance of Shares to the extent permitted under Delaware Law
and meeting the rules and regulations of the SEC concerning plans satisfying the
requirements of Section 16(b)(3) of the Exchange Act. The cash proceeds of the
sale of Shares subject to Options are to be added to the general funds of the
Company and used for its general corporate purposes as the Board of Directors
shall determine.
9. EXERCISE OF OPTION.
(a) Procedure or Exercise; Rights as a Stockholder. Any Incentive Stock
Option granted hereunder shall be exercisable at such times and subject to such
conditions as may be determined by the Committee, including performance criteria
with respect to the Company and/or the Optionee, and as shall be perishable
under the terms of the Plan, but in no event earlier than one year after the
date of the grant and not later than 10 years after the date of the grant. Any
Non-qualified Stock Option granted hereunder shall be exercisable at such times
and subject to such conditions as may be determined by the Committee, including
performance criteria with respect to the Company and/or the Optionee, and as
shall be perishable under the terms of the Plan, but in no event later than 10
years after the date of the grant.
(b) Fractional Shares. An Option may not be exercised for a fraction of
a Share.
(c) Notice of Exercise. An Option shall be deemed to be exercised when
written notice of such exercise has been given to the Company in accordance with
the terms of the instrument evidencing the Option by the person entitled to
exercise the Option and full payment for the Shares with respect to which the
Option is exercised has been received by the Company. Full payment may,
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as authorized by the Board, consist of any consideration and method of payment
allowable under Section 8(c) of the Plan; it being understood that the Company
shall take such action as may be reasonably required to permit use of an
approved payment method. Until the issuance, which in no event will be delayed
more than thirty (30) days from the date of the exercise of the Option (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company), no right to vote or receive dividends
or any other rights as a stockholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. No adjustment will be made
for a dividend or other right for which the record date is prior to the date the
stock certificate is issued, except as provided in the Plan.
(d) Effect of Exercise. Exercise of an Option in any manner shall
result in a decrease in the number of Shares which thereafter may be available,
both for purposes of the Plan and for sale under the Option, by the number of
Shares as to which the Option is exercised.
(e) Termination of Status as an Employee. If any Employee ceases to
serve as an Employee for any reason, s/he may, but only within thirty (30) days
(or such other period of time as is determined by the Committee, but not to
exceed ninety (90) days in the case of Incentive Stock Options, or ten (10)
years in the case of Non-qualified Stock Options) after the date s/he ceases to
be an Employee of the Company, exercise his/her Option to the extent that s/he
was entitled to exercise it as of the date of such termination. To the extent
that s/he was not entitled to exercise the Option at the date of such
termination, or if s/he does not exercise such Option (which s/he was entitled
to exercise) within the time specified herein, the Option shall terminate.
(f) Disability. Notwithstanding the provisions of Section 9(e) above,
in the event an Employee is unable to continue his/her employment with the
Company as a result of his/her total and permanent disability (as defined in
Section 105(d)(4) of the Internal Revenue Code of 1986, as amended), s/he may,
but only within three (3) months (or such other period of time not exceeding
twelve (12) months as is determined by the Committee) from the date of
disability, exercise his/her Option to the extent s/he was entitled to exercise
it at the date of such disability. To the extent that s/he was not entitled to
exercise it at the date of such disability, or if s/he does not exercise such
Option (which s/he was entitled to exercise) within the time specified herein,
the Option shall terminate.
(g) Death of Optionee. Notwithstanding the provisions of Section 9(e)
of the Plan, in the event of the death of an Optionee who was at the time of
his/her death an Employee of the Company and who shall have been in Continuous
Status as an Employee since the date of grant of the Option, the Option may be
exercised at any time within twelve (12) months following the date of death by
the Optionee's estate or by a person who acquired the right to exercise that
would have accrued had the Optionee continued living one (1) month after the
date of death.
(h) Continuous Status as Employee. Except as set forth in Sections
9(e-g) of the Plan, no Optionee may exercise an Incentive Stock Option unless
between the time of the grant of the Option and the time of exercise thereof
s/he has been in Continuous Status as an Employee.
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10. RESTRICTED STOCK AWARDS.
(a) General. A Restricted Stock Award shall entitle the Participant, if
s/he has been in Continuous Status as an Employee during the Restriction Period
determined by the Committee and subject to his/her complete satisfaction of any
other conditions, restrictions and limitations imposed in accordance with the
Plan, to the unconditional ownership of the Shares covered by the grant without
payment therefor. Until the contingency occurs by which the Participant is
entitled to unconditional ownership of the Shares covered by the grant, such
Shares shall not be considered issued. Until such issuance, which in no event
will be delayed more than thirty (30) days from the date of the contingency has
occurred (as evidenced by the appropriate entry on the books of the Company or
of a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a stockholder shall exist with respect to the
Shares. No adjustment will be made for a dividend or other right for which the
record date is prior to the date the stock certificate is issued, except as
provided in the Plan.
(b) Granting. The Committee may grant Restricted Stock Awards at any
time or from time to time to a Participant selected by the Committee in its sole
discretion. A Restricted Stock Award may be granted only to a new or prospective
officer, employee or consultant as an inducement to such person's employment by
the Company. The Committee shall establish at the grant of each Restricted Stock
Award a fixed period of time (the "Restriction Period") during which the
Participant performs service for the Company and, at the discretion of the
Committee, during which certain performance objectives (the "Performance
Objectives") set by the Committee must be achieved. At the time of grant, the
Restriction Period and, if applicable, the Performance Objectives, shall be set
forth in agreements or guidelines communicated to the Participant in such form
consistent with this Plan as the Committee shall approve from time to time.
(c) Termination. Except as hereinafter provided, if, during the
Restriction Period applicable to such grant, the Participant has not been in
Continuous Status as an Employee for any reason other than death, disability, or
involuntary termination of the Participant for other than Cause, all Shares
covered by such grant shall be forfeited to the Company automatically. If the
Participant's separation from employment is because of death, disability,
retirement, or involuntary termination for other than Cause, the Participant or
his/her successor in interest shall be entitled to unconditional ownership of a
fraction of the total number of Shares covered by such grant, of which the
numerator is the number of whole calendar months in the period commencing with
the first whole calendar month following the date of grant and ending with the
whole calendar month including the date of death, disability or termination, and
of which the denominator is the number of whole calendar months in the
applicable Restriction Period, unless the Committee, in its discretion,
determines that the Participant shall be entitled to receive all of the Shares
subject the grant. Any fractional Shares shall be disregarded. If the
Participant's separation from employment is because of voluntary termination or
involuntary termination for Cause, the Participant shall forfeit all rights to
any and all Restricted Stock Awards previously granted to such Participant.
(d) Deferment. A Participant entitled to the unconditional ownership of
the Shares covered by the grant of a Restricted Stock Award may request in
writing, within thirty (30) days after the Participant has become so entitled,
to defer the Participant's right to unconditional ownership of
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such Shares for a period of up to six (6) months, but in the event such
extension lasts beyond the date on which the Participant's status as an Employee
is terminated, the extension shall be deemed to be the date on which the
Participant's status as an Employee is terminated. If applicable law permits,
the Participant's obligation to remit to the Company an amount sufficient to
satisfy any federal, state or local income and payroll tax withholding liability
corresponding to such Shares shall be deferred for the same amount of time, if
any.
11. NON-TRANSFERABILITY OF INCENTIVES. An Incentive may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other
than by will or by the laws of descent or distribution and may be exercised,
during the lifetime of the Participant, only by the Participant.
12. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER. Subject to
any required action by the stockholders of the Company, the number of shares of
Common Stock covered by each outstanding Option, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option, as well as the price per share of
Common Stock covered by each such outstanding Option, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split or the payment of a stock dividend with
respect to the Common Stock or any other increase or decrease in the number of
issued shares of Common Stock effected without receipt of consideration by the
Company; provided, however, that conversion of any convertible securities of the
Company shall not be deemed to have been "effected without receipt of
consideration." Such adjustment shall be made by the Committee, whose
determination in that respect by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price
of shares of Common Stock subject to an Option.
In the event of the proposed dissolution or liquidation of the Company,
or in the event of a proposed sale of all or substantially all of the assets of
the Company, or the merger of the Company with or into another corporation, the
Board of Directors of the Company shall, as to outstanding Options, either (i)
make appropriate provision for the protection of any such outstanding Options by
the substitution on an equitable basis of appropriate stock of the Company or of
the merged, consolidated or otherwise reorganized corporation which will be
issuable in respect to one share of Common Stock of the Company; or (ii) upon
written notice to an Optionee, provide that all unexercised Options must be
exercised within a specified number of days of the date of such notice or they
will be terminated. In any such case, the Board of Directors may, in its
discretion, advance the lapse of any waiting or installment periods and exercise
dates.
13. TIME FOR GRANTING INCENTIVES. The date of grant of an Incentive
shall, for all purposes, be the date on which the Committee makes the
determination granting such Incentive. Notice of the determination shall be
given to each person to whom an Incentive is so granted within a reasonable time
after the date of such grant.
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14. AMENDMENT AND TERMINATION OF THE PLAN.
(a) Board Action. The Board may amend or terminate the Plan from time
to time in such respects as the Board may deem advisable; provided, however,
that the following revisions or amendments shall require approval of the holders
of a majority of the outstanding shares of the Company entitled to vote:
(i) any increase in the number of Shares subject to the Plan,
other than in connection with an adjustment under Section 12 of the Plan;
(ii) any change in the designation of the class of persons
eligible to be granted options; or
(iii) any material increase in the benefits accruing to
participants under the Plan.
(b) Solicitation of Stockholder Approval. If any amendment requiring
stockholder approval under Section 14(a) of the Plan is made, such stockholder
approval shall be solicited.
(c) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated, unless mutually agreed otherwise between the Optionee and
the Board, which agreement must be in writing and signed by the Optionee and the
Company.
15. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued
pursuant to the exercise of an Incentive unless the exercise of such Incentive
and the issuance and delivery of such Shares pursuant thereto shall comply with
all relevant provisions of law, including, without limitation, the Securities
Act, the Exchange Act, the rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the Shares may then be listed, and
shall be further subject to the approval of counsel for the Company with respect
to such compliance.
As a condition to the exercise of an Incentive, the Company may require
the person exercising such Incentive to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares, if in the
opinion of counsel for the Company, such a representation is required by, or
appropriate under, any of the aforementioned relevant provisions of law.
16. RESERVATION OF SHARES. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
Inability of the Company to obtain authority from any regulatory body
having jurisdiction, which authority is deemed by the Company's counsel to be
necessary to the lawful issuance and sale
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of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.
17. INCENTIVE AGREEMENT. Incentives shall be evidenced by written
agreements in such form as the Committee shall approve.
18. INTENTIONALLY OMITTED.
19. OTHER PROVISIONS. The Incentives agreement authorized under the
Plan shall contain such other provisions, including, without limitations,
restrictions upon the exercise of the Incentive, as the Board of Directors of
the Company shall deem advisable. Any Incentive agreement shall contain such
limitations and restrictions upon the exercise of the Incentive Stock Option as
shall be necessary in order that such option will be an Incentive Stock Option
as defined in Section 422A of the Internal Revenue Code of 1986, as amended.
20. INDEMNIFICATION OF BOARD. In addition to such other rights of
indemnification as they may have as directors or as members of the Board, the
members of the Board shall be indemnified by the Company against the reasonable
expenses, including attorneys' fees actually and necessarily incurred in
connection with the defense of any action suit or proceeding, or in connection
with any appeal therein, to which they or any of them may be a party by reason
of any action taken or failure to act under or in connection without the Plan or
any Incentive granted thereunder, and against all amounts paid by them in
settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a judgment
in any such action, suit or proceeding that such Board member is liable for
negligence or misconduct in the performance of his/her duties, provided that
within sixty (60) days after institution of any such action, suit or proceeding
a Board member shall, in writing, offer the Company the opportunity, at its own
expense, to handle and defend the same.
21. WITHHOLDING TAX. Whenever the Company proposes or is required to
issue or transfer shares of Common Stock under the Plan, a Participant shall
remit to the Company an amount sufficient to satisfy any federal, state or local
income and payroll tax withholding liability prior to the delivery of any
certificate or certificates for such shares. Alternatively, in the sole
discretion of the Company, to the extent permitted by applicable laws including
regulations promulgated under the Exchange Act, such federal, state or local
income and payroll tax withholding liability may be satisfied prior to the
delivery of any certificate or certificates for the shares by an adjustment,
equal in value to such liability, in the number of shares to be transferred to
the Participant. Whenever under the Plan payments are to be made in cash, such
payments shall be net of an amount sufficient to satisfy any federal, state or
local income and payroll tax withholding liability.
22. OTHER COMPENSATION PLANS. The adoption of the Plan shall not affect
any other stock option or incentive or other compensation plans in effect for
the Company or any Subsidiary, nor shall the Plan preclude the Company from
establishing any other forms of incentive or other compensation for employees
and directors of the Company or any Subsidiary.
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23. COMPLIANCE WITH EXCHANGE ACT RULE 16b-3. With respect to persons
subject to Section 16 of the Exchange Act, transactions under the Plan are
intended to comply with all applicable conditions of Rule 16b-3 or its
successors under the Exchange Act. To the extent any provision of the Plan or
action by the Board fails to so comply, it shall be deemed null and void, to the
extent permitted by law and deemed advisable by the Board.
24. SINGULAR, PLURAL; GENDER. Whenever used herein, nouns in the
singular shall include the plural, and the masculine pronoun shall include the
feminine gender.
25. HEADINGS, ETC., NO PART OF PLAN. Headings of Articles and Sections
hereof are inserted for convenience and reference; they constitute no part of
the Plan.
26. GOVERNING LAW. The Plan, such Incentives as may be granted
thereunder and all related matters shall be governed by, and construed in
accordance with, the laws of the State of Delaware from time to time in effect.
27. PARTIAL INVALIDITY. The invalidity or illegality of any provision
herein shall not be deemed to affect the validity of any other provision.
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